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The trade mark that stops an ad campaign? IP and related issues in marketing by bookmakers

A website is devoted to retired racehorse Black Caviar where roses, horse-care products and a range of merchandise may be purchased – all bearing the famous mare’s trade marked name or racing silk design. Makybe Diva, another registered mark, will adorn a marquee at this year’s Melbourne Cup, and its $920 tickets are already sold out. Not only is “Melbourne Cup” a registered trade mark of the Victoria Racing Club Ltd, so too is “The Race that Stops a Nation”.

Clearly, businesses see value in marketing that refers to famous racehorses and racing events, including bookmakers and other betting providers. “The Bet that Stops a Nation” is currently being promoted, and a member of the William Hill Group has acquired naming rights to the (Sportingbet) Cox Plate. This raises questions as to how far bookmakers in particular may go in linking themselves and their products to particular horses and meets without becoming exposed to legal risk as rights-holders act to protect their intellectual property.

This note considers who might be expected to assert intellectual property rights in this area, before overviewing potential pitfalls that advertisers might face in respect of trade mark infringement and false sponsorship representations.

Who are the rights-holders?

Racehorse names, jockey silks and more.

The Australian Rules of Racing prohibit thoroughbreds running in races without first being registered with the Registrar of Racehorses. Naming rules apply, including restrictions on naming horses after past winners. Some names, including those of horses that have won the Melbourne Cup, are permanently unavailable.1

Since 1 October 2012, as a condition of registration, horse owners agree to the Registrar (in effect to Racing Information Services Australia – RISA) owning “all right, title or interest (including but not limited to copyright, goodwill and reputation) in the name, image, jockey silks and any other indicia associated with the horse, whether existing before or after the horse is registered”, and assign these to the Registrar to the extent they own or have an interest in them.2

Further, owners undertake not to apply to register these features as a trade mark as well as to refrain from asserting any claim of ownership of any such intellectual property rights.3

Owners are, however, granted a non-exclusive and non-transferable licence to use this intellectual property owned by RISA for “any purpose related to racing, training, promoting and otherwise dealing with the horse, including merchandising”. This may be sub-licensed. RISA has disclaimed any intention to derive any income from merchandise associated with horses.4

For horses registered after October 2012, the Registrar of Racehorses may apply for trade marks in these indicia and to protect or defend this intellectual property. Other persons may only own trade marks and intellectual property concerning horses registered before this point – for example, take Black Caviar and Makybe Diva, trade marks owned by Black Caviar Racing Pty Ltd and Makybe Racing and Breeding Pty Ltd, respectively.

It remains to be seen whether the Registrar will seek to exploit its rights as fully as racehorse owners might (or have). One reason given for the changes to the Rules was to ensure that racing bodies could perform functions necessary for the efficient administration and promotion of the industry, including publishing racing information.5 RISA considered this could be jeopardised by allowing owners to register horse names as trade marks. In any event, at least for trade marks, there is scope for bookmakers to continue to make some use of names within the limits of the trade marks regime and other laws (discussed below).

Names of races, meets etc.

Race names may be registered as trade marks and some are owned by various racing clubs. For instance, the Mooney Valley Racing Club Inc has registered “Cox Plate”, and the Victoria Racing Club Ltd owns several trade marks concerning its major events.

Sponsors of races or events, especially those with naming rights, may be granted exclusive rights to use the names under a sponsorship agreement. They may also have obligations to prevent others from misrepresenting themselves as a sponsor or other official associate of the event. And even if they do not, the Australian Consumer Law (ACL) prohibits misleading and deceptive conduct, including by representations of sponsorship or approval.

What conduct is risky? And how can this risk be minimised?

Wagering operators with approval to use Race Fields Information are usually able to publish information that identifies the name or number of a horse taking part in an intended race, but do not obtain any intellectual property or other rights in that information.

Wagering providers should therefore be wary of using that information in any way that may amount to trade mark infringement or be considered false, misleading and/or deceptive.

Trade mark infringement.

The registered owner of a trade mark is granted the exclusive right to use (and to authorise others to use) the mark in relation to the goods or services for which it is registered. Others may not use marks that are substantially identical or deceptively similar to the registered mark in that manner, or in relation to goods or services that are closely related to the registered class(es). Third parties are prohibited from using a registered word mark as an AdWord or TextAd on Google, for example.

Bookmakers wishing to refer to indicia associated with events or horses in their advertising or marketing should accordingly take steps to identify whether such indicia are trade marked in order to consider whether there is an infringement risk. Similarly, if a bookmaker receives a letter of complaint from a trade mark owner, it should be taken seriously.

There is no infringement of a trade mark if it is used, in good faith, descriptively – to indicate a characteristic of goods or services. So promotions offering great odds on ‘Horse Y’, or a special offer for ‘Event X’ will not necessarily infringe trade mark rights. Indeed, “Tattersall’s Melbourne Cup Sweepstakes” is itself a registered mark. However, care should be taken not to assert a sponsorship or association where none exists.

Misleading and/or deceptive conduct.

The prohibition on misleading and deceptive conduct in trade or commerce covers a wide variety of circumstances and cannot be discussed in any detail in this brief note. However, it is worth noting a specific example of such conduct, which is a false representation of sponsorship, approval, or affiliation.

Using a well-known person’s image in conjunction with a marketing campaign without permission may be considered misleading and deceptive. This is especially the case when that person is widely known to be an endorser of products. For example Telstra’s advertisement featuring Olympic swimmer Kieran Perkins wearing a swimming cap with its logo was found to misrepresent that Perkins was sponsored by Telstra.6 In a similar decision, The Senior’s Choice was recently forced to pay damages and the legal expenses of Ita Buttrose when its website used her image to promote aged care franchises. Using Ita Buttrose’s image without permission was considered likely to mislead and deceive the public into believing that the franchises were endorsed by the celebrity.

Applying these principles in light of the status of some races, racehorses, jockeys, or persons associated with particular racing silks; bookmakers ought to be aware of using images or other advertising material in a manner that might be considered to falsely imply endorsement or authorisation. In order to manage the risk of such promotions, businesses should avoid unauthorised use of images of specific people or animals without permission of the owner of those images. A safer strategy would be for businesses to use images of events where specific individuals are not identified or highlighted and in this way minimise suggestions of a specific endorsement.

The position would seem to be similar in respect of racing events. Given the formal announcement of Sportingbet becoming the naming rights holder of the WS Cox Plate (Sportingbet Cox Plate), some advertising may be more risky than others in implying a formal affiliation – for example, “The [Bookmaker name] Cox Plate Special Offer”, might carry greater risk than “The Cox Plate Special Offer at [Bookmaker name]”.

It is also important for businesses to secure the appropriate rights to the images and phrases it wishes to publish on its websites and promotional material. Many standard and subscription image licences grant only limited rights, and specifically prohibit commercial or advertising purposes.

Overall

This note is not comprehensive, it has covered only the major points of interest in this area, and necessarily briefly. More generally, it will be interesting to see whether RISA or the Australian Racing Board adopt a discernibly different approach to protecting the intellectual property gained under the Rules of Racing to the racehorse owners who were previously able to obtain those rights.

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